Clarion Partners appears ready to trade a San Francisco office tower it bought in 2014 for $107 million at about two-thirds off that price.
Presidio Bay Ventures is the likely buyer of 60 Spear Street, the San Francisco Business Times reports. Cyrus Sanandaji, managing principal at the San Francisco-based development firm, told the publication that his company had bid on the property but could not speak to pricing and said the deal had not yet closed.
“We’re continuing to focus on opportunistic deals downtown,” Sanandaji said.
Multiple sources reportedly said that an unnamed “high net worth” individual had partnered with the developer to buy the 11-story South Financial District tower at $235 per square foot, about one-third of its value when New York-based Clarion Partners purchased it nine years ago.
Of course, much has changed in the city since then, with offices now one-third empty and the South Financial District facing steep challenges of late. Asking rents are down 13 percent citywide compared to the first quarter and are 20 percent off their pre-pandemic peak, according to Colliers data.
When the sale of 60 Spear closes, it will add to the growing number of downtown San Francisco office buildings that have reportedly traded at prices more than half off their previous values. SKS will buy 350 California Street, which is 75 percent empty, for around $200 per square foot, a 75 percent discount from what Mitsubishi UFJ Financial Group, based in Tokyo, hoped to get for the property in 2020. Nearby, Wells Fargo reportedly accepted an offer on 550 California that is $60 million off the $108 million the bank paid for the tower in 2005 after rejecting offers it deemed too low last year. The buyer is unknown.
When the sales close, the values will go from rumored to reality and possibly set a new floor for San Francisco commercial prices.
—Emily Landes
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